S&P rates athenahealth, loans B-; cuts subsidiary

S&P said it assigned to athenahealth Group Inc. an issuer credit rating of B-. The outlook is stable.

Bain Capital and Hellman & Friedman are acquiring athenahealth from Veritas Capital and Evergreen Coast Capital for about $17 billion.

The company will fund the transaction with a $5.75 billion term loan B, a $1 billion delayed-draw term loan B facility, $2.5 billion of unsecured debt, an undrawn $1 billion revolving credit facility, $2.36 billion of preferred equity, and common equity. S&P assigned B- issue-level and 3 recovery ratings to the company's secured debt, indicating an expectation for meaningful (rounded estimate: 65%) recovery in the event of payment default.

The agency also lowered the issuer credit rating on athenahealth Intermediate Holdings LLC to B- from B and expects to withdraw that rating and the issue-level rating on the company's legacy debt at close of transaction because it expects the company will repay all currently outstanding debt.

“We expect athenahealth to maintain its strong growth trajectory in 2022 as it continues to gain share in the ambulatory space,” the agency said in a news release.

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